The correlation between the micro- and nanostructure of a material and its physical and chemical properties is the key issue in materials development. Considerable progress has been achieved recently by the development of new processing technologies (hot-filament-CVD-deposition) and new materials in a nanocrystalline state (nanodiamond) with superior mechanical strength and tribological properties. A novel fabrication method, based on CVD diamond deposition has recently been established. Reliable processing parameters have been developed in order to produce rather thick samples of diamond with an average grain size of about 15 nm on several different substrates. Further processes based on lithographic techniques known from silicon technology allow high-precision microstructuring of CVD-diamond. So far, the microstructuring of conventional highly oriented columnar diamond has been hampered by the fact that the plasma etching process results in rather rough surfaces. This problem now can be overcome by the production of nanodiamond. It can be expected that microparts (ultra-sharp cutting tools, functionalized diamond surfaces, microtoothed wheels etc.) now can be produced on a reliable basis. The fabrication of ultra sharp diamond cutting edges, resulting in radii of curvature below 10 nm has already successfully been demonstrated. Several examples for applications will be discussed. Lifetime extension is the key issue here. The financial support by the federal ministry BMBF-PTJ Jülich in the project “diamond based cutting tools” is gratefully acknowledged.